Forums: Discussions for entrepreneurs and small business.

So I had a meeting today at our local Small Business Development Center and I was discussing my website project with the staff there. They were all very supportive of the idea and super-encouraging to get the ball rolling but they threw me a curve ball talking about business liability in terms of my web site.

To recap for those who are not familiar - I`m going to be opening a website that offers vacationers coming to my area a way to see the top-rated businesses and events that are available in my area while they are visiting the region.

The SBDC mentioned that it may be best to form an LLC for this web site so that, for example, if "Bob`s Hotel" gets a lot of bad ratings on the website and they lose a lot more business - Bob can`t point his finger at my website and sue ME because users gave him poor ratings.

My question(s) are:

1) Wouldn`t a Terms of Agreement page (required acceptance before any account / posting is created) remove me from any loss of revenue claims?

2) What benefit does an LLC give me in terms of protection in the above example?

Thanks!



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Shawn R. Tooley
North Country Design
87 Lisbon Street
Heuvelton, NY 13654
Phone: (315) 307-3359
Email: shawn@northcountrydesign.us
Web: http://www.northcountrydesign.us

http://www.pcworld.com/article/156605/posting_negative_reviews_could_get_you_sued.html

http://www.medialaw.org/Content/NavigationMenu/Public_Resources/Libel_FAQs/Libel_FAQs.htm#Can%20I%20Be%20Sued%20for%20Something%20I%20Put%20on%20the%20Internet?

http://www.cio.com/article/476414/Posting_Negative_Reviews_Could_Get_You_Sued

Even if you`re an LLC, I don`t think that will prevent/protect you from being sued.

In every article you posted (I skimmed each one) they are suing the person who wrote the comment and not the person who owns the website.

If I crash my car into someone`s house - they`re not going to sue the car dealership, the automobile industry or my insurance agent - they`ll sue me - because it was me `behind the wheel`.

However, that being said, I`d like to protect myself anyhow... and the question is: Will an LLC help prevent me being sued in the above situation.



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Shawn R. Tooley
North Country Design
87 Lisbon Street
Heuvelton, NY 13654
Phone: (315) 307-3359
Email: shawn@northcountrydesign.us
Web: http://www.northcountrydesign.us

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Off-topic, but I wish that it were true in all industries.  The original Piper Aircraft Company, started in the early 20th Century by William Piper went out of business in the late 1970`s (and caused other manufacturers, such as Cessna, to stop all production of personal airplanes) because of just such a suit.  (Piper was purchased in 1995 from bankruptcy and renamed the "New Piper Aircraft Co.").

Picture this - a drunk, non-pilot steals an airplane from a local airport in southern California (it happened to be a Piper Comanche) and proceeded to fly it through a mountain.  His estate sued Piper, the engine manufacturer, the airplane`s owner, the airport, the mechanics who worked on the airplane, etc.  And won.  Multi-million dollar awards from each of the defendants (except the airport).

Now, to the OP question.  If you are a hands-off third party provider, just a medium to facilitate the exchange of information, then you do have some immunity.  Look for "website safe harbor" for more information.

Personally, I welcome criticism of my work and service.  It makes me a better business person.


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Steve Mann
Internet Videographer
MannMade Digital Video
My Email

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if there is a faulty design in the brakes, the home owner that gets hit might sue the driver and the manufacturer and the call seller.

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James Lindon, Ph.D. Patent Attorney
Lindon & Lindon, LLC
Cleveland, Ohio
Patents, Trademarks, Copyrights, Pharmacy Law, Litigation
[this is not legal advice - provided for discussion only]
Intellectual Property for the Individual and Small Business: Identify, Protect, Enforce, Defend.
"Fools rush in where angels fear to tread."
http://www.LindonLaw.com